Thread by @maryashakil

Constitution Bench headed by Justice S Abdul Nazeer delivers a majority (4:1) judgement upholding central Govt’s 2016 demonetisation

Important observations:
-reasonable nexus between the purpose to be achieved & the limitations on the constitutional rights
(1/5) #Demonetization

- RBI does not have independent power to bring in demonetisation
- provisions of Sub section 3 and 4 cannot be referred to in isolation (referring to point above)
- power under Section 26 (2) of the RBI Act cannot be said to be utilised for only a particular series of bank notes

- The notification issued by the Government thus satisfies the test of proportionality and the time period provided for exchange of currency cannot be said to be unreasonable.
- Court cannot supplant the wisdom of executive with its wisdom. #Demonetization

- Decision making process cannot be faulted merely because the proposal emanated from the Central Govt

Dissenting judge opined:
- powers of the parliament cannot be exercised through a gazette notification, but only through a legislation. #Demonetization

- there was no independent application of mind by the RBI.
- opinion given by the RBI cannot be construed as a "recommendation" under Section 26(2) of the RBI Act.
- demonetisation initiated is unlawful. But status quo ante cannot be restored at this point of time.
(5/5)